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Thursday, February 25, 2010

Heroin - Xalisco in Ohio

Sam Quinones of The Los Angeles Times recently reported about a relatively new drug network. His three part series, "The Heroin Road," is a must read for those interesting in understanding the impact of drugs in our area. You may be surprised by both the scope of the problem and the ingenuity of those involved.

Have you ever heard of the Xalisco (ha-LEES-ko) boys? They have helped spread heroin addiction by leaving the wholesale business to the cartels and mining outsize profits from the retail trade, selling heroin a tenth of a gram at a time. Dennis Chavez, Denver police narcotics officer, has arrested dozens of them from Xalisco, an obscure corner in the Pacific Coast state of Nayarit, Mexico, and has diligently studied their recent activity. Competition among networks has reduced prices and now Xalisco connections are nationwide.

Unlike Mexico's big cartels -- violent, top-down organizations that mainly enrich a small group -- the Xalisco networks are small, decentralized businesses, each run by an entrepreneur whose workers may soon strike out on their own and become his competitors. "They have no all-powerful leader and rarely use guns," according to narcotics investigators and imprisoned former dealers. (Sam Quinones, "The Heroin Road," The Los Angeles Times, February 14 2010)

The Xalisco boys use convenient delivery by car and aggressive marketing to move into cities and small towns across the United States. The create demand for heroin in places where there was once little or none. And, of course, overdoses and deaths increase in their wake. The product is cheaper and more potent than Colombian heroin. It seems customer satisfaction is high based on both convenience and "bang for the buck."

Users do not have to drive into dangerous neighborhoods to get their fix. They simply phone in their orders and drivers deliver the product, sometimes even courtesy calling after delivery to check on the quality of service. Special sales are conducted in which dealers reward users with free heroin for bringing in new customers. Addicts in Columbus, Ohio, say they offered rewards for referrals to new users: eight or 10 free balloons of heroin for every $1,000 in sales an addict brought in. Also, the dealers have actively targeted recovering addicts at clinics.

When police do arrest a driver, a replacement arrives from Xalisco, and is usually fairly well set up to make $1,000 a week plus expenses within two weeks  The replacements already know where the customers live and go to their houses and introduce themselves.

Appalachia, Ohio and Xalisco

According to narcotics agents and former dealers, Xalisco immigrants drove black tar's eastward expansion, moving into Columbus, Ohio, and from there to parts of rural Ohio and Pennsylvania and to Nashville and Charlotte.

The Xalisco dealers have been particularly successful in parts of Appalachia and the Rust Belt where addiction to prescription painkillers like OxyContin, Percocet and other prescription painkillers was already widespread. They market their heroin as a cheap, potent alternative to pills. Many of those addicts, mainly young middle- and working-class whites, switched to black tar, which is cheaper and more powerful.

Among the distinctions of Xalisco dealers is that they generally do not sell to African Americans or Latinos. Instead, they have focused on middle- and working-class whites, believing them to be a safer and more profitable clientele, according to narcotics investigators and former dealers. "They're going to move to a city with many young white people," Dennis Chavez said. "That's who uses their drug and that's who they're not afraid of." (Sam Quinones, "The Heroin Road," The Los Angeles Times, February 14 2010)

"The classic picture of a heroin addict is someone who steals," said Gary Oxman, a Multnomah County (Oregon) Health Department doctor who conducted the study of overdoses. "That disappears when you have low-cost heroin. You could maintain a moderate heroin habit for about the same price as a six-pack of premium beer." It was the same in other cities where Xalisco dealers settled. In Denver, addicts say the cost of a dose of black tar has dropped as low as $8.

In Ohio, where Xalisco networks arrived around 1998, black tar has contributed to one of the country's worst heroin problems. Since then, deaths from heroin overdoses have risen more than threefold, to 229 in 2008, according to the Ohio Department of Health. The number of heroin addicts admitted to state-funded treatment centers has quintupled, to nearly 15,000.

Ohio has become one of the centers of Xalisco networks. Quinones reported, " was through a junkie in Columbus that black tar made its way to Huntington, West Virginia. Competition among Xalisco networks kept prices low. OxyContin pills cost $80 apiece and addicts needed five or six a day. Black-tar heroin was stronger and cost less than $50 for a day's fix."

Preferring to stay clear of the nation's largest cities (avoiding established heroin trade organizations), Xalisco dealers have cultivated markets in the mountain states and parts of the Midwest and Appalachia. Before a string of fatal overdoses in 2007, "we didn't even consider heroin an issue," said Huntington, West Virginia, Police Chief Skip Holbrook. (Sam Quinones, "The Heroin Road," The Los Angeles Times, February 14 2010) Twelve fatalities shook Huntington during the fall and winter of 2007. All were caused by black-tar heroin.

By 2007, black-tar addiction had spread across Columbus, Dayton, Cleveland and other Ohio cities. "At Columbus-based Maryhaven, Ohio's largest drug-treatment center, opiate addicts made up 20% of the center's patients in 1997, and many were addicted to prescription painkillers. Today, 70% are black-tar heroin addicts," said Paul Coleman, Maryhaven's president. (Sam Quinones, "The Heroin Road," The Los Angeles Times, February 14 2010)

There are no official estimates of how much money Xalisco networks make, but narcotics agents who have busted and interrogated dealers say that a cell with six to eight drivers working seven days a week can gross up to $80,000 a week.

Origins of Xalisco

Quinones said, "Two pioneers of the Xalisco model met in the early 1990s in the Northern Nevada Correctional Center, where they were serving time for drug offenses. One of them agreed to discuss the system's beginnings and its spread on the condition that he be identified only as Max, an alias he said he used as a heroin dealer." (Sam Quinones, "The Heroin Road," The Los Angeles Times, February 14 2010)

Max said he was familiar with the U.S. heroin trade and that his partner, a native of Xalisco, had access to supplies of black tar and workers from his hometown. When the two were released from prison, Max said, they set up a heroin ring in Reno.

At the time, dealers sold heroin from houses, which police could easily target. Max and his partner had a better idea: Dealers could circulate in cars and receive instructions via pager (and later by cellphone). So, a system evolved: Drivers carried heroin doses in their mouths in tiny uninflated balloons, each about the size of a pencil eraser. Addicts dialed a number, as if ordering pizza. The dispatcher would page the driver with a code indicating where to meet the addict.

Max, who went to federal prison for his role in the scheme, said one reason the system did not evolve into a cartel controlled by one person or family is that Xalisco County is made up of ranchos, small villages famous for their independent spirit and intense rivalries.

In Albuquerque, he bought a counterfeit birth certificate and driver's license; he crossed the border posing as an American from then on. Back in Xalisco, he hired drivers from villages near his own, paying smugglers to bring them across the border.

The county consists of the town of Xalisco and 20 villages with a total population of 44,000 -- about the size of Los Angeles' Silver Lake neighborhood. Landless sugar-cane workers, eager to grasp their version of the American Dream, provide a virtually endless supply of labor for the heroin networks, one reason the system has proved so hard to eradicate. Nayarit's mountains are filled with small poppy farms and that black tar is easily made.

The rise of the Xalisco networks is a peculiar tale of dope, poverty and business ingenuity that connects a remote corner of Mexico with vast stretches of America's heartland. Xalisco ostensibly still depends on sugar cane. But it is now among the top 5% of Mexican counties in terms of wealth, according to a government report.

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